Kulicke And Soffa Industries, Inc. · NASDAQ:KLIC
Kulicke And Soffa Industries — Q1 2020 Earnings Presentation
24 slides from Kulicke And Soffa Industries's earnings presentation, Jan 30, 2020
Slide 1: Quarterly Update: A World of Opportunity
NASDAQ: KLIC Quarterly Update A WORLD OF OPPORTUNITY December 2019
Slide 2: Safe Harbor
SAFE HARBOR In addition to historical statements, this presentation contains statements relating to future events and our future results. These statements are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, and include, but are not limited to,
Slide 3: Company & Industry Evolution, Current Landscape
COMPANY & INDUSTRY EVOLUTION CURRENT LANDSCAPE
Slide 4: Who We Are
WHO WE ARE NASDAQ: KLIC DOMINANT, ESTABLISHED SOLID VALUE POSITIONS FUNDAMENTALS DELIVERY • Market Leader • Proven Management • Aggressive Share Repurchases • Long-term History • Core-Business Optimization • Regular Dividend • Broad End-Market Diversification • Several Growth Initiatives • Operating
Slide 5: Semiconductor assembly adjacent growth opportunities
$47B $9B $1B SEMICONDUCTOR SEMICONDUCTOR ELECTRONICS FABRICATION ASSEMBLY & TEST ASSEMBLY (“EA”) Chip design & wafer fab Chip assembly & test Electronic device assembly $4B Back-End Assembly Metrology & Lithography Dicing Bonding Packaging EA Inspection Back-End Wafer Inspection Blade Dicing Die Att
Slide 6: A World of Opportunity
A WORLD OF OPPORTUNITY Internet of Things, Artificial Intelligence Autonomous TECH EVOLUTION SUPPORTS CONSISTENT CORE MARKET GROWTH Mobility 4X EQUIPMENT PORTFOLIO GROWTH SINCE 2008 Internet Data Center Personal & Corporate Computing 1981 1998 2008 2018 2022 IC PACKAGES PRODUCED 260B 560B 1T IC ASSE
Slide 7: Socially Responsible
SOCIALLY ✓ Annual Energy Reduction of 2% RESPONSIBLE Local ✓ ✓ Annual Paper OUR COMMITMENT Community Reduction of Engagement 3% Kulicke & Soffa and its employees around the world are committed to sustainability. We are focused on continually improving our social, environmental, and economic impact t
Slide 8: Positioned to Execute
POSITIONED TO EXECUTE CONTINUAL BUSINESS ENHANCEMENT Organizationally Prepared Increased Competiveness, New Market Access & Operating Leverage Research & Development Aftermarket Product & Services (APS) •Accountability & Ownership •Accountability & Ownership •Business Unit Dedicated Teams •Centraliz
Slide 9: Key Growth Opportunities
KEY GROWTH OPPORTUNITIES 5
Slide 10: Expanded Opportunities
EXPANDED OPPORTUNITIES Through Aggressive Development & Prudent Acquisitions Advanced Packaging Aftermarket $1B Products & Aftermarket Products & $1.9B+ Wire Bond 2014 Served Services >13% CAGR Services 2019 Served Electronics Market Market Assembly Advanced Packaging Wire Bond 10
Slide 11: Broad End Applications
BROAD END APPLICATIONS Expanding Markets, Technology Inflections & New Solutions Memory 12% LED • 2 Yr Sales Averaged $714M 9% • Share Leader in Core Markets General Semiconductor Revenue by Advanced • Aggressive Development Packaging 51% End Market 7% • New Tools in Qualification • Positioned for G
Slide 12: Capacity Expansion
CAPACITY EXPANSION Acceleration of Semi-Unit Production Expands Core Business Key Enablers • IoT & low-cost connected devices • High bandwidth connectivity - global 4G and 5G rollouts G • Solid state memory shift from traditional HDD • Cloud and data center services Semiconductor Unit Growth to Acce
Slide 13: New Capability #1 – Automotive
NEW CAPABILITY #1 – AUTOMOTIVE Auto Semiconductor sales to outpace Semi growth by 3X, through 2023 AVERAGE SEMI K&S AUTO INDUSTRY SALES AS % OF SALES AS A % TOTAL OF TOTAL* K&S IS WELL POSITIONED TO BENEFIT • Fundamental Electrification and Autonomy 18% 2X EXPOSURE TO Transitions AUTO GROWTH • Globa
Slide 14: New Capability #2 – Advanced Packaging
NEW CAPABILITY #2 – ADV. PACKAGING Several New Systems in Early Production and/or New Customer Qualifications Scaling has historically enabled the This technological inflection is demanding industry’s progress on: new solutions to increase: • Performance & capability • Semiconductor count per packag
Slide 15: New Capability #3 – Mini & Micro LED
NEW CAPABILITY #3 – MINI & MICRO LED Disruptive Ultra-High-Speed Placement System - PIXALUXTM POTENTIAL FOR VALUE CREATION IN SEVERAL POSITIONED TO BENEFIT: SIGNIFICANT END APPLICATIONS • Close Customer Engagement • Televisions & Monitors – Backlighting & Direct View • Rapidly Developed Through Part
Slide 16: Comprehensive Solutions
COMPREHENSIVE SOLUTIONS POSITION SOLUTIONS GENERAL AUTOMOTIVE ADVANCED SEMI & LED & INDUSTRIAL PACKAGING • DOMINANT POSITIONS • DIVERSIFIED END MARKETS Aftermarket Products and Services (APS) • HIGH-PERFORMANCE • LEADING CUSTOMERS Ball Bonding MARKET DRIVERS • GENERAL SEMI & LED Electronics Assembly
Slide 17: Financials, Targets
FINANCIALS TARGETS
Slide 18: December Quarter
DECEMBER QUARTER MARCH QUARTER REVENUE GUIDANCE: $140M-$170M Quarterly Results - U.S. GAAP Non-GAAP Results & Target Fiscal Q1 2020 Change vs. Fiscal Q1 2019 Change vs. Fiscal Q4 2019 Net Revenue $144.3 million down 8.2% up 3.2% Gross Profit $70.4 million down 5.9% up 7.6% Gross Margin 48.8% up 120
Slide 19: Continued Through-Cycle Performance
CONTINUED THROUGH-CYCLE PERFORMANCE Revenue ($M) Operating Margin 269 244 216 216 214 222 200 24.0% 185 156 150 157 19.1% 146 140 144 17.8% 16.3% 17.1% 18.1% 17.7% 127 109 116 13.3% 11.5% 9.3% 9.3% 7.5% 5.5% 2.7% 1.4% Dec '15 Mar '16 Jun '16 Sep '16 Dec '16 Mar '17 Jun '17 Sep '17 Dec '17 Mar '18 Ju
Slide 20: Strong Cash Flow & Balance Sheet
STRONG CASH FLOW & BALANCE SHEET Net Cash Position & TTM Free-Cash-Flow Generation (Values in Millions of USD) 700 420 600 360 TTM Free Cash Flow - $USD 500 300 Net Cash - $USD 400 240 (line) 650 (bar) 300 597 609 629 621 614 633 617 180 548 573 540 525 499 532 200 440 120 275 100 60 71 0 0 K&S Fisc
Slide 21: Peer Benchmark
PEER BENCHMARK Comparison to Semi Capital Equipment Peers with $800M-3.2B Market Cap 60.00% 25.00% 10.00% 2.50% 25.00% KLIC 48.00% 20.00% 7.60% 2.00% 20.00% Average 36.00% 15.00% 5.20% 1.50% 15.00% 24.00% 10.00% 2.80% 1.00% 10.00% Peer Range 12.00% 5.00% 0.40% 0.50% 5.00% 0.00% 0.00% -2.00% 0.00% 0.
Slide 22: Delivering Value
DELIVERING VALUE Dramatically Increased Shareholder Returns Fiscal 2014-2Q18 2021 Target • $350M Returned Since August 2014 • Focused on Fundamentals • Creating Organic & Inorganic Growth • Enhancing Operating Leverage +125%* • Outpaced Target Through FY’19 31% 50% • Accelerated Repurchase Activity
Slide 23: Summary
SUMMARY Organizational Dominant Significant Growth Track Record of Alignment Has Core-Market Growth Drivers Execution to Value Delivery Accelerated Positions Supporting Enhance Progress High-Potential Operational Markets Leverage 23
Slide 24: Q&A
FOR FURTHER Q&A QUESTIONS & DISCUSSION: INVESTOR@KNS.COM
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